Epiphany Industries is considering a new capital budgeting project that will last for three years. Epiphany plans on using a cost of capital of 12% to evaluate this project. Based on extensive research, it anticipates sales of 100,000 in each of the three years. The costs of goods sold will be 50% of the sales. The corporate tax rate is 35% and the anticipated changes of working capital are -5000 for years 1,2 and 10,000 for year 3. To realize this project, Epiphany needs to purchase equipment worth 90,000 at the start of the project which will be depreciated by the straight line method in the next three years. For each of the following questions choose the closest answer.

i. The annual depreciation is